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Kolkata, Dec 18 (IBNS): General Manager, National Insurance Co Ltd, A V Girijakumar Tuesday asserted that the current global economic slowdown is perhaps one of the reasons why there has been a growing interest in the insurance industry.
A V Girijakumar said that currently the global insurance sector is worth USD 5000 billion and the Indian insurance sector has recorded enormous growth in a short span of time.
He was speaking at a conference by the Confederation of Indian Industry (CII) on 'InsureInd: Changing Risk Landscape and Insurance Solutions,' to analyze the expected impact of recent policy changes on business and retail and key issues in life and non life segments which have major bearings on industry and individuals.
With $6 billion capital, the insurance sector draws USD 300 billion investments, clearly indicating the sector’s huge growth potential.
"The main focus of the insurance sector is to penetrate the rural market aided by latest technologies such as mobile, etc. The Central Government has already set goals for the same," said Girijakumar.
The penetration of the life insurance sector has increased while the health insurance sector has also grown significantly, he said.
Girijakumar said that the sector, however, will face a few challenges.
"First, the main concentration is on fostering innovative insurance products and customer services rather than on competing prices. Second, proper pricing is required. Third, a lack of proper regulation of the healthcare infrastructure is affecting the healthcare insurance sector."
"Finally, the management and expansion of the skilled talent base are not keeping pace with the rapid growth of the sector," he said.
Girijakumar emphasized that a lot of capital infusion is required especially in the non-life sector as it involves only $20 billion investment out of the $300 billion.
“India is poised for expansion in the insurance sector. Hence, it is important to address the challenges”, he said.
The CII-Marsh India Report, which was unveiled during the conference, discussed in detail the global scenario, emerging risks & insurance solutions and employee benefits.
CEO, Marsh India Insurance Brokers Pvt. Ltd., Sanjay Kedia said the CII-Marsh Report seeks to add to the discourse on the global risk challenges and their interconnections and implications for various countries, including India, and companies.
“We are living in an increasingly interdependent world, and the potential impact of risks has increased. In this environment of greater volatility and uncertainty, risk management has a major role to play,” said Kedia.
Emerging risks like rising cyber risks, environmental risks, supply chain risk and natural catastrophes are major areas of concern. Insurance markets need to collaborate with corporate to manage risk and find probable solutions.
“Corporate world must look at what to insure, what to retain and what to control to achieve optimum total cost of risk,” he said.
CEO, Magma HDI General Insurance Company Ltd., Swaraj Krishnan said that the Indian Insurance industry is at the crossroads of opportunities and challenges.
Only a nuanced approach through informed decision can steer the Industry to widen its reach and disburse efficient services to individuals and corporate.
Since the recent financial meltdown all companies have been under serious considerations of factors of risk management and capital handling. Bottom lines are under severe pressure.
He said, “This to be the opportune moment to come out together with possible solutions from industry perspectives.”
Present on the occasion were Chairman, CII Eastern Region R K Agrawal and Chairman, Economic Affairs, Finance & Taxation Sub Committee, CII Eastern Region S K Menon.